Bad credit and mortgage brokers

Bexter

I'll try and keep this as brief as possible - basically I am in a muddle of mixed mortgage advice and unsure what to do.

I signed a trust deed (Scottish IVA more or less) in 2003. I finished payments last year but closing it down has been dragged out by the trustee and my actual discharge is coming through this week. Additionally, 10 of the lenders included in the trust deed still have the accounts marked on my credit file as 'defaulted' rather than 'settled', though I am receiving conflicting advice about how much this matters now they are 5 years old and were included in the TD. Obviously next year they will come off my file via the 6 year rule.

However my partner and I need to get a mortgage. I have spoken to two adverse specialist brokers and am being told there are literally only a couple of lenders who will consider me. Our circumstances are;-

Deposit of 10%
Looking to buy at c. £225k
Joint salaries £63k
Around £3k unsecured debt between us
A mortgage on my credit file that ended last year, always paid on time
Both been in same FT jobs for 5 years apiece, on electoral roll, no dependents

So! Broker one - can't get 90% LTV - only 85%. Fee of c. £1k. Has had full credit check done by 'packager' and says rate will depend on the date my discharge is finally issued.

Broker 2 - only done 'quotation' search - says he CAN get a mortgage from Future (who the broker above claims turned me down on credit score) at 90% LTV on a 7.25% 2 year fix. Fee will be 2% of loan though - so £4k...

(quote from broker 2 - Our fees may seem high, but, we are not just a one man band who sends hisdeals to a packager to sort out the nitty, gritty details.... We are a mortgage broker, as well as a full packager with exclusive deals with a
number of lenders and other packagers. Just because one broker has access
to some particular products, does not mean that all brokers will have
access to the same products.")

Can anyone offer any advice - espeically regarding whether it's true that some brokers can get access to deals that others can't? Is there anyone cheaper I should be trying to get access to the deal through (I obviously have to work out otherwise whether we try and raise the extra money for an additional 5% deposit or just pay the broker £4k to get the 90% deal).

I don't want to waste lots of brokers' time, but I obviously want the best deal (and I am trying to make sure I only get quotation searches to avoid too many footprints).

I know all the reasons why it would probably be better to wait but I need to start improving my rating and rent will cost us way more over a year than the brokers fees will. And prices are good at the moment and the area we will buy in is a good one with great schools catchment - and we'll stay a long time.

Any help or advice would be massively appreciated.

AndrewSmith

The main problem you have is that these supposed 'adverse specialists' are usually nothing more than packagers for a very few number of lenders. They usually have access to literally only 3-4 lenders.

They do not take into account the fact that some mainstream lenders will also accept some adverse credit (it does vay on the severity and type, and the overall case merits) at not much more than normal rates.

I would suspect that the second broker is wrong, especially if you have been told by the first one that Future have declined you on credit score. My fear with the first broker is the word 'packager'. This means he has handed the case over to a third party packaging firm who will only work on behalf of a small number of lenders. He has probably done this as he does not know who to place the case through himself and he will be recieveing some form of enhanced commission/fee from the packaging firm.

Ask for a copy of his sourcing results and why he placed you via a packager. Ask if he has exhaused all 'high street routes' prior to doing this and ask for evidence of this.

It is a lazy option to simply throw the case to a packager without looking properly first.

sarkin

Andrew do me a favour and stop slaging off other brokers, the guy has come here for help he does not want to know the ins and outs of the mortgage industry.

Conrad

Try 5 brokers and see what happens.

Obtaining nmere qutes is a total waste of time as they are meaningless - no one can guess whether your application will stand a chance until its been credit assessed by a lender.

First National Direct (for brokers)= and NOT available via packagers) is an option as is Future, but Future decline most of the cases they get in even months down the line.

This industry is riddled with bullsh1tters. Ive lost count of the number of times Ive heard someone has access to exclusive schemes. Im a small firm and can access all schemes - its just a case of being bothered to register to those firms and packagers providing exclusive schemes.

AndrewSmith

How is that slagging off other brokers? I offer nothing but the truth about how the OP's application is being handled and what to look out for to ensure he is treated in the best way possible.

It is a common problem in the mortgage industry these days, and one that Martin himself has taken up, that these so called 'specialist adverse brokers' do not offer high street alternatives and usually charge higher than is necessary broker fees for processing the application.

Obviously you feel it is OK for 'specialist firms' to operate in this way? I personally do not. I am free as any consumer is on this site, to post my opinion and thoughts on a situation.

Do me a favour and stop trying to defend a practice that dis-advantages many people trying to obtain a mortgage today.

Leon_W

All you need to do is ask Broker 1 if he has something in writing from Future declining you. That will tell you all you need to know as there will be no point in going any further with broker 2.

Also I can't see what beef Andrew has with packagers as good ones will help speed up the application. Of course, you have no way of knowing if this will happen, but as a rule, brokers do not deal with poor packagers, what would be the point ? So what if the packager only had one lender on his panel ? If it's the only one that will lend to you then I can't see what the arguments about

Regards

sarkin

I like the way you are free then screw all your customers with premium rate phone numbers
Say no to rip off 0870 numbers

very money saving

AndrewSmith

Leon_W wrote: »

Also I can't see what beef Andrew has with packagers as good ones will help speed up the application. Of course, you have no way of knowing if this will happen, but as a rule, brokers do not deal with poor packagers, what would be the point ? So what if the packager only had one lender on his panel ? If it's the only one that will lend to you then I can't see what the arguments about

Regards

No one is saying that packagers are a bad thing in absolute. What I am making reference to is the fact that, as stated by the OP, the brokers he has approached claim to be 'adverse specialists' which usually means they either work soley for one packaging firm with a limited panel of 3-4 lenders, or as a 'specialist adverse' broker only deal with a very small number of lenders in their own right and do not take into account high street alternatives. Hence my advising the OP to obtain a copy of the sourcing results (which he is entitled to do so) and evidence that all other routes were exhausted prior to the Packager becoming involved.

What is wrong with telling someone to make sure they are getting what they are entitled to and make sure they are being given the best advice?

AndrewSmith

sarkin wrote: »

I like the way you are free then screw all your customers with premium rate phone numbers
Say no to rip off 0870 numbers

very money saving

So is £195.00 fee on completion as well as a proc fee.

What does any of that have to do with me giving the poster an honest opinion and word of warning about what to look for?

Talk about defensive attitude :rotfl:

sarkin

Hey Andy its just sales talk our packager has over 30 lenders but we still say specialist. You do understand sales talk

but to be honest i cant stand peole who use premium rate numbers and then try and come accross all money saving.

I await your reply to why you rip your customers off with premium rates I bet Martin would love that.

sarkin

I charge a fee because its part of my business its on my website people can read if they dont want to do business with me they can go else where. but premium rate are hidden charges